4. Auctions Hosted by External Fundraiser(s)
A) Overview
When it comes to tax receipts, auctions can be quite complex. You are strongly
encouraged to contact us at Giving@The519.org for our guidance. Below is a basic
overview of receipting information as it pertains to auction events – auction
organizer/fundraisers, auction suppliers, and winning bidder.
• Auction Organizer/Fundraiser - The 519 cannot issue charitable tax receipts to the
organization/person donating the collected funds from the Auction Event.
• Auction Suppliers – These are the organizations that provide items for the auction
you are hosting. Organizations providing items for your Auction Event are not
eligible for a charitable tax receipt.
• Winning Bidder – These are individuals who make a winning bid on an auction item.
Charitable tax receipts for these individuals are based on the Fair Market Value
(FMV) of the item they won at the auction. The tax receipt is calculated as the
difference between the FMV (advantage) and the winning bid amount.
• Fair Market Value (FMV) is what a consumer would pay if the gift is bought in the
open market.
• The winning bid must meet the intention to make a gift threshold: the posted FMV of
the lot item cannot exceed 80% of the winning bid. This means that a winning bid
that is over 80% of the posted FMV is not eligible for a charitable tax receipt.
Example: Bike Bought at Auction
The FMV of the bike posted at the auction is declared to be 400 CAD. The winning
bid for the bike at the auction is 550 CAD.
Calculation of eligible amount for tax receipt:
o Winning bid of 550 CAD less the FMV (advantage to donor) of 400 CAD =
Eligible tax receipt amount of 150 CAD
o However, if the FMV of the bike was not made known to bidders in advance
of the auction, a receipt could not be issued to the winning bidder.
B) Ways to Donate Proceeds of Your Auction
These are the ways that the Auction Organizer/Fundraiser can donate the funds
collected:
• Mail a cheque to The 519
ATTN: Lili Rathgeb, Coordinator, Philanthropy & Donor Relations
519 Church Street, Toronto, ON M4Y 2C9
• Do an Electronic Funds Transfer (EFT) - EFT information available upon request.
Contact Rafael: RGlassMachado@The519.org